Keystone Pipeline Project

1
Keystone

• CEPs intervention

2
Keystone Pipeline

• TransCanada, is proposing to transport about
  435,000 barrels per day of crude oil from
  Hardisty, Alberta to Wood River and Patoka,
  Illinois through an approximate 2,960 kilometre
  pipeline system.
• This project includes the proposed conversion of
  860 kilometres of existing natural gas pipeline
  in Saskatchewan and Manitoba to oil service.
• This project also includes construction of three
  sections of new pipeline as part of the project
• 270 kilometres of pipeline from Hardisty,
  Alberta to the Alberta/Saskatchewan border.
• 100 kilometres of pipeline from the Carman
  Meter Station on our Canadian Mainline system
  near Winnipeg, Manitoba to the United
  States/Canada border, and
• 1,730 kilometres of pipeline from the United
  States/Canada border to Patoka Illinois.

3
Keystone grades

• Keystone will export primarily Dilbit and Synbit
  grades of oil
• Upgraded oil (light synthetic crude) is primarily
  for Canadian refiners.

Source CAPP
4
Competing proposals

• Keystone is one of several competing proposals to
  export the new oil sands production. It seeks
  early regulatory approval to gain an advantage.

5
Keystone is lead project

• Q56. Are there other proposed pipelines that can
  meet the demand of crude transportation sooner
  than Keystone?
• A56 The Applicants understand that there are
  other projects proposing to transport significant
  volumes of crude oil out of the WCSB to various
  markets. The Enbridge Gateway project and the
  Kinder Morgan TransMountain III Expansion project
  will serve offshore markets. The Enbridge Alberta
  Clipper project targets similar markets to
  Keystone. These projects are in various states of
  development but none are in a position to meet an
  in-service target of 2009. All have either
  publicized timelines that are proposing later
  in-service dates, are based on substantial
  looping of existing lines, or are proposing
  greenfield development through difficult terrain.
  As of this date, no other project has announced
  the execution of transportation service
  agreements with shippers.

Source Keystone application
6
TransCanada -- ConocoPhillips

• CALGARY (CP) -- TransCanada Corp.'s plans to
  enter the rapidly expanding oilsands
  transportation business with its 2.1 billion
  Keystone pipeline from Alberta to the U.S.
  Midwest got a major boost with a shipping
  commitment and potential partnership deal with
  American energy major ConocoPhillips.
  Calgary-based TransCanada announced that
  ConocoPhillips had signed a deal commiting it to
  ship an unspecified amount of oil on the Keystone
  line and possibly acquire a 50 stake in the
  project. ConocoPhillips has a refinery at Wood
  River and a half-share in the Surmont oilsands
  project in northern Alberta along with
  France-based Total S.A. The company also has a 9
  stake in the Syncrude joint venture. In Canada,
  ConocoPhillips became a major oil and gas
  producer through the acquisition of Gulf Canada
  Resources in 2001. It's operations stretch from
  Western Canada to the frontier regions of the
  Mackenzie Delta and off the East Coast.

7
Political moment on alternatives

• 07/07/06
• Call a halt, Albertans
• Peter Lougheed is urging a moratorium on oil
  sands projects while the province's residents are
  asked what kind of development they want, and at
  what pace
• JEFFREY SIMPSON

• Camford Chemical Report
• May 22, 2006
• Chemical industry visits Queen's Park
• Ontario urged to take lead in
• revitalization of manufacturing
• Larry MacDonald, senior vice-president and CFO
  for Nova Chemicals and CCPA board chairman, made
  a strong plea to provincial lawmakers at a
  reception for RCLG participants and MPPs.
  MacDonald gave the example of the Keystone
  pipeline that will transport 435,000 bbl/day of
  oilsands crude from Alberta to Illinois. He said
  this crude should not be shipped outside the
  country where it will be refined and turned into
  products and exported around the world. Lets
  create that value right here in Canada, in
  Ontario, he said.

8
CEP goals

• To assert our energy policy in the NEB Keystone
  hearing and to encourage a policy debate on
  character and rate of oil sands expansion
• To make value-added and industrial policy a
  factor in NEB decisions.

• To position the union as a participant in
  regulatory and energy policy decision making.
• To support projects that provide the best
  outcomes for CEP members.

9
CEP Evidence

• Economic research on net benefit of upgrading oil
  in Canada
• Crude oil pricing / NAFTA / Canadian refining
• Natural gas needs and pricing
• Canadian energy security
• Public interest mandate of NEB

10
NEB Timelines

• Information requests 8 August 06
• Responses to information 22 August 06
• Written evidence of interveners 05 Sept 06
• Reply to evidence 10 October 06
• Hearing commences 23 October 06

11
Projected budget